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Debating Solutions with Stefan Molyneux and Ed Bugos

I recently wrote an article expressing my views that capitalism needs regulation. I agreed with Max Keiser in a dispute that he had on his TV show with anarcho-capitalist Jeff Berwick.

Libertarians took offense and my article was immediately attacked by free market thinkers such as Stefan Molyneux and Ed Bugos. I have enjoyed many of Stefan’s videos and often agree with his viewpoints, but he comes off in a condescending and cocksure manner that is hard to stomach. It seems like he thinks that he is always right and anyone that disagrees with his views is always wrong, uneducated or misinformed. There seems to be little room for compromise, change or new ideas.

I was also criticized by Jeff’s business partner Ed Bugos and although he remained mostly civil, there was always the sense that he was the wise teacher telling his little students what is right and wrong. He certainly seems to think that he has a monopoly on truth in his writings. While I enjoy researching, contemplating and writing about better ways to structure our political and economic systems, I always try to avoid this type of absolutist thinking. (Read Ed’s article here)

We are living in a constantly shifting and evolving world, so what was considered fact just a few decades ago is now being disproved. What was once thought impossible is now possible due to technological advances. This significantly changes the landscape and options that we have for restricting our broken system, but too often people find a position they like, dig in and resist any type of change in perspective.

Jeff, Stefan and Ed seem to argue as if they held absolute truths or were defending the existence of the sun or gravity. We should keep in mind that until they are implemented and tested, we are arguing ideas and theories, nothing more. Even Einstein’s theories are now being called into question and quantum physics is demolishing old beliefs about how the world works.

So if we can remove our egos from the discussion, hopefully we can learn from each other instead of digging in and attempting to win at all costs. We are entering a period of great change and my intent is simply to provide for the exchange of ideas that can hopefully prepare us to usher in a healthier, happier, more prosperous and sustainable world. I particularly enjoy the discussion of solutions, rather than the much lazier task of pointing out all of the problems, complaining and blaming.

The current political and economic system has grown very fragile and seems ready to collapse under the weight of it own corruption any day now. It could be next month or next year, but the outcome seems unavoidable. Our leaders have been kicking the can down the road for too long and it is finally time to face the music on a wide range of critical issues.

The debt has grown too burdensome for anyone to bear, whether it is individuals, governments or entire economies. So, we must have these debates, discussions and be ready to collaborate on solutions.

My original article stating the need of a referee in capitalism admittedly misses the bigger problem. We have an unsustainable debt-based monetary system that encourages and rewards abhorrent behavior, greed, exploitation and cronyism, while creating artificial scarcity and the concentration of the world’s wealth and resources in the hands of a few.

I think we can agree about this current state of affairs. The disagreement comes with how to address it and change the system for the better. I am supportive of the ideas of smaller government, balanced budgets, the elimination of the FED, returning the power of printing money to the Treasury, a non-interventionist foreign policy, the elimination of tax loopholes, lowering of overall tax rates, repeal of the Patriot Act and maximizing of freedoms and individual liberties.

But although these are all great ideas that would give us a vastly superior system, I still don’t think they are enough. They may help with the concentration of wealth, particularly by taking away the printing press from both the banks and spend-crazy politicians, but I don’t see how any of these steps would address the issue of artificial scarcity or technological unemployment. How do libertarians suggest that we get out from underneath the mountain of debt we currently owe? I believe we either have to default or hyperinflate, neither one being a desirable outcome.

Stefan’s couch criticism of my ideas started off with him saying that the government is to blame for our economic mess by controlling the interest rates and money supply. Of course, these two key functions are controlled by the PRIVATE Federal Reserve and not the government. But perhaps he was intending to point out that the government and the banks are essentially one.

Of course, I do understand that the government shares in the blame and interrupts free market efficiencies and price discovery with centralized planning. But this does not excuse the action of the FED and banks that have systematically co-opted the government for their own benefit, crashed the economy, looted taxpayer money and destroyed the middle class. They colluded with the government and they are essentially one and the same at this point. As much as the right likes to complain about the U.S. becoming Socialist, our system more closely resembles that of Fascism or Corporatism.

Stefan also assumes that my theories are purely academic and not based on any real world experience in the free market. I can see where he is coming from and might agree if he were correct. But he is not. I am a serial entrepreneur that has been profiting in the free market for nearly 20 years. I have consulted to Fortune 500 companies, working in client management for the world’s largest market research company. I have done well personally, both as an employee and as a business owner, but that is not enough to get me to cheer on a system that is destroying so many others. I will give Stefan and Ed the benefit of the doubt regarding their motivations, but I have met more than a few supporters of anarcho-capitalism and the illusory “pure free market” that advocate simply for the sake of their own enrichment, regardless of the net impact on society.

When I went on to argue that we need regulations to make sure that chemical companies don’t dump their toxins in a creek, Stefan says the solution is simply to buy insurance. I have to admit that I like this idea, but can we really expect everyone to buy insurance against every potential threat in life? Would we all have to buy air quality insurance, water insurance, food insurance, building material insurance, insurance against my bank going under, insurance against cell phone radiation, on and on?

That might be great for the insurance industry, but it does not seem efficient or cost effective to have everyone go out and purchase dozens of different insurance policies. Plus, insurance companies are often the middle man contributing to the rise in prices for many goods and services. Their whole goal is to charge as much as possible and deny as many claims as possible. When it comes to car insurance, health insurance any many other forms of insurance, the buyer would usually have been better off to save the premium payments. Otherwise, insurance companies would not be generating the profits that they do. Still, I think it is an interesting idea in that it would create a financial disincentive for corporations to harm others, IF they faced financial repercussions for their bad deeds.

But how does the insurance company claim damages and provide justice to victims? They need a court and threat of violence, or else who enforces the claims. And who would be the threat of violence if not the government? Private security forces paid for by private courts or insurance companies? I am not comfortable with the idea of privatized force and coercion with absolutely no accountability.

In a for-profit world, particularly one with debt-based money, what keeps this system from getting completely corrupted? What keeps the insurance companies honest and what keeps the judicial system from being bought off? If it is a private insurance company or private judicial system and their number one goal is to maximize profit, couldn’t the guilty corporations simply pay them more than they receive representing the people? If so, how will people ever get justice?

This gets to the root of the issue… corruptibility. Is it easier to keep a governmental system or privatized system free from corruption?

I believe that it is easier to set up an honest governmental system, because there are safeguards in place, there is still some form of representation through voting and it is the entire purpose of government to be formed “of the people, for the people and by the people.” The government has the potential to actually be filled with uncorrupted citizens acting in interest of the 99%. It was designed that way by the founders and government actually worked for quite some time before becoming entirely corrupted throughout the past century. So, there is some historic precedent and therefore the potential of an honest government.

By contrast, a private corporation will always make decisions based on what is most profitable for the executives and major shareholders. That is their very mission. There is not much motivation to align their decision-making process with what is best for society or for the environment. Participants are incentivized to make as much money as possible in the short term and there is little or no incentive for long-term thinking or improving society absent monetary reward.

It seems to me that corporations will always tend towards corrupt in pursuit of greater profits, because they are engaged in a system that rewards and incentivizes abhorrent behavior. With debt-based money, they are also engaged in a system where productive value is drained in interest payment to the banks, while the rest of us are left scrambling for fewer and fewer crumbs of the money pie.

The only way that I might envision a privatized free market system working effectively is if it were operating in a world of abundance rather than scarcity. If our monetary system was not acting to concentrate wealth and create artificial scarcity, perhaps there would be incentives for acting in the best interest of our planet and the majority of its inhabitants, not just a small number of board members of shareholders.

Napoleon was once asked why there aren’t more great statesman. He pointed out the inherent contradiction that still exists in our political and economic system. He said the traits and qualities needed to attain power are in direct contradiction to the traits and qualities needed to effectively exercise power. You often need to be ruthless, dishonest, corrupt and immoral to attain political or economic power. But you need to be compassionate, objective, honest and benevolent to effectively exercise power. These two contradictory sets of traits rarely exist in the same person.

So perhaps whether it is the government or the private market that settles disputes, either one will tend toward corruption within the confines of our current system. How do we overcome this?

The solution that I propose involves one simple goal: creating abundance. We currently have the technology and resources to be able to create an abundance of life’s necessities and many of life’s luxuries for everyone on the planet. Yes, even with a growing population of 7 billion. If we can work together to create abundance and eliminate the artificial scarcity and heavy concentration of wealth/resources in society, we will eliminate the tendency towards corruption. Once basic needs are met, people’s behavior will change. We are products of our environment and so the only way to create true change is to change the environment in which we live to one that does not reward and encourage corruption, greed, hoarding, selfishness and planetary destruction.

The implications of such a system are tremendous. Imagine how we would treat each other and what we might be able to accomplish if we weren’t constantly fighting against each other in a desperate attempt to stay afloat. Crime and violence would all but disappear. There would no longer be people dying of hunger or preventable disease. There would no longer be a need to slave away 8 or more hours of every day in monotonous, unrewarding jobs that add little value to society. It would literally resolve all of our political and economic problems while unlocking the potential of humanity and ensuring that we don’t destroy our environment and ourselves in the process.

We have the means, the resources and the technology to be creating abundance for all at this very moment. It is not some fantasy, pipe dream or rambling of an ungrounded idealist. The ideas presented in the films below need to be developed and are not perfect, but they are magnitudes better than what we have now.

They offer viable solutions to the key issues of scarcity and sustainability. This is something missing from capitalism, socialism and any other “ism” within our current paradigm. This is not a coercive or violent system in any way and does not entail a large, centralized, powerful government entity.

Our current path is clearly unsustainable as evidenced by the uprisings taking place around the globe, the crumbling of economies, the intensifying climate change, the extinction of entire species from our food chain and the destruction of our environment. We have to stop the bickering and come together to create true and lasting change.

If you are skeptical, I understand. But please dig into the information below, watch the films with an open mind, spread the word and let’s start changing our reality. I welcome your thoughts, ideas and criticisms of the specific solutions in these films. This is an invitation to Max Keiser, Jeff Berwick, Stefan Molyneux and Ed Bugos. Let’s move past the finger-pointing, chest-pounding and ego-flailing arguments and come together on ideas for a new system and solutions that benefit everyone.


Zeitgeist: Moving Forward

Thrive: What on Earth Will It Take?

By | 2017-03-23T14:06:27+00:00 November 21st, 2011|Gold & Silver Commentary|

About the Author:

Jason Hamlin is the founder of Gold Stock Bull and has been investing in precious metals for over 20 years. Jason spent nearly a decade in analytics for the world’s largest market research firm, before finding success investing full time. He launched Gold Stock Bull in 2005 and turned his focus from helping fortune 500 companies to helping individual investors. Jason is a student of Austrian economics and a proponent of cryptocurrencies such as bitcoin and ethereum.